All of the following are examples of an externality EXCEPT:
A)bees kept to make honey pollinate plants belonging to a nearby farmer.
B)smoke from a factory imposes cleanup costs on nearby residents.
C)a group purchases a farm on which to grow its own food.
D)a company dumps toxic waste into a river,forcing people downstream to drink polluted water.
E)a school club cleans up a public beach,creating a litter-free and safer swim area for all beachgoers.

Question

Quizplus · Accepted Answer

Option C is not an example of an externality as it involves individuals producing a good for their own consumption and does not affect any third party. All other options involve some sort of impact on individuals or the environment outside of those directly involved in the activity.

All of the Following Are Examples of an Externality EXCEPT